Market Potential for
Environmental Technology in Asia

By Ferdinand C. Aldo
October 1993

The Author is Consultant & Associate of ECO Services International in Jakarta, Indonesia

Asia, a Growth Region

The continuing dynamic pace of economic development in the countries of Eastern and South-East Asia is impressive. Today, this region has gained international recognition as a focal point of industrial growth in world terms. Trading links within the region have now made it largely independent of trends within the main economic blocks of the US, Europe and Japan. Asiaīs economic vitality is expressed in strong growth rates at a time of economic stagnation in many other parts of the world.

Challenges of Industrialization

The advancing countries of Eastern and South-East Asia urgently need to find solutions to the environmental consequences of rapid growth. The significance of improved environmental protection is gaining recognition across the region, as Asiaīs accelerating pace of expanding its manufacturing capabilities continues. There is a growing consensus that economic development will die with the environment. From China to Indonesia, governments are thus pursuing tighter legislation in an effort to moderate pollution and foster more efficient use of resources. This is reflected by an increasing prominence of ecological considerations in the decision-making processes.
However, to balance the need of economic development against the cost of environmental deterioration is a difficult task.

Current Situation

The economic growth of the past 30 years in Asia produced the fastest rise in income for the biggest number of people in human history. Societies which twenty years ago produced little or no waste using indigenous materials, are now faced with an ever growing volume of non-degradable waste products. Urbanization is projected to reach 50% by the turn of the century. The consumption patterns of urban populations are unlike those of rural people, using more industrial goods and energy-intensive services.
Very different levels of implementation and enforcement of environmental standards exist throughout the region. Organisation and finances of local authorities can hardly keep pace providing basic infrastructure and sanitation services like water supply and sewerage to the rapid and widespread urbanization. As a result, "waste disposal" is carried out in millions of open back-yard fires every day. The most troubling aspect of Asiaīs pollution problem is that no one knows exactly how big it is. Only a fraction of the toxic waste generated is being treated. The rest is illegally buried in landfills, or tipped into rivers and the ocean.
Home to half of the worldīs population, these conditions provide an unprecedented opportunity to suppliers of environmental technology from around the world.

Partnership for Progress

While the environmental market in the industrialized world is largely matured, and in some areas is beginning to show signs of saturation, it is only just emerging in Asia. The application of clean and efficient manufacturing processes using renewable resources remain relatively isolated. A lack of information about alternate solutions - rather than economical constraints - appears to be the main reason for sticking to traditional production methods and practices.
Increasingly, the focus is shifting from combating the damage caused by pollution to preventing pollution during the production process. Integrated solutions are needed, calling for flexible alliances between vendors. Suppliers of waste plastic injection or extrusion equipment, to illustrate the case, are challenged to generate proposals which combine their offering with waste material collection banks, granulators, and all other components required for a closed-loop operation. Product sales need to be supplemented by technical assistance, like the provision of suitable moulds for the production of appropriate new items from the recycled plastic.
The ability to increase the local content of environmental facilities will ensure accommodation of and response to specific customer requirements.

New Technology Potential

At the beginning of the century, electric vehicles (EVīs) dominated the world markets for motorcars. Their decline only began after the introduction of electric starters for oil-burning vehicles. If a power-supply infrastructure for EVīs existed almost 100 years ago, it can be built again. And if there will be 40,000 EVīs on Californiaīs roads by 1998, why couldnīt the same happen in Asiaīs numerous mega-cities?
It is more economical for US utilities to provide remote homes lying over two miles from the nearest power line with independent solar installations, rather than extending the grid. Indonesia has already provided renewable energy to 20,000 homes, while India will equip some 150,000 homes with solar power by 1997.

The Market is Here

The global market for environmental technologies and services was around US$ 380 billion in 1995, and is projected to reach US$ 550 billion by the year 2000. Asia, representing the fastest growing segment of this market, is increasingly adapting innovative approaches for sustainable development. The absence of adequate infrastructure over vast areas, with fast growing populations and economies, call for the rapid implementation of environmentally compatible solutions.


Copyright © 1993, ECO Services International